Exhibit A
GUARANTY NATIONAL CORPORATION
EQUITY INCENTIVE PLAN
1
Section 1. Purpose of the Plan
The purpose of the Guaranty
National Corporation Equity Incentive Plan (the "Plan")
is to further the interests of Guaranty National
Corporation (the "Company") and its shareholders by
providing long-term performance incentives to those key
employees of the Company and its Subsidiaries who are
largely responsible for the management, growth and
protection of the business of the Company and its
Subsidiaries.
Section 2. Definitions
For purposes of the Plan, the
following terms shall be defined as set forth below:
(a) "Award" means any Option,
Performance Unit, Restricted Stock, Stock granted as a
bonus or in lieu of other awards, other Stock-Based
Award, Tax Bonus or other cash payments granted to a
Participant under the Plan.
(b) "Award Agreement" shall mean the written
agreement, instrument or document evidencing an Award.
(c) "Change of Control" means and
includes each of the following: (i) the acquisition,
in one or more transactions, of beneficial ownership
(within the meaning of Rule 13d-3 under the Exchange
Act) by any person or entity or any group of persons or
entities who constitute a group (within the meaning of
Section 13(d)(3) of the Exchange Act), other than (x)
Orion Capital Corporation or a direct or indirect
subsidiary thereof or (y) a trustee or other fiduciary
holding securities under an employee benefit plan of
the Company or a Subsidiary, of any securities of the
Company such that, as a result of such acquisition,
such person, entity or group either (A) beneficially
owns (within the meaning of Rule l3d-3 under the Ex
change Act), directly or indirectly, more than 20% of
the Company's outstanding voting securities entitled to
vote on a regular basis for a majority of the members
of the Board of Directors of the Company or (B)
otherwise has the ability to elect, directly or indi
rectly, a majority of the members of the Board; (ii) a
change in the composition of the Board of Directors of
the Company such that a majority of the members of the
Board of Directors of the Company are not Continuing
Directors; or
(iii) the stockholders of the Company approve a merger
or consolidation of the Company with any other
corporation, other than a merger or consolidation which
would result in the voting securities of the Company
outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being
converted into voting securities of the surviving
entity) at least 80% of the total voting power rep
resented by the voting securities of the Company or
such surviving entity outstanding immediately after
such merger or consolidation, or the stockholders of
the Company approve a plan of complete liquidation of
the Company or an agreement for the sale or disposition
by the Company of (in one or more transactions) all or
substantially all of the Company's assets.
Notwithstanding the foregoing, the preceding
events shall not be deemed to be a Change of Control if,
prior to any transaction or transactions causing such
change, a majority of the Continuing Directors shall have
voted not to treat such transaction or transactions as
resulting in a Change of Control.
(d) "Code" means the Internal Revenue Code of 1986, as
amended from time to time.
(e) A "Continuing Director" means, as of any date of
determination, any member of the Board of Directors of the
Company who (i) was a member of such Board on the effective
date of the Plan or (ii) was nominated for election or
elected to such Board with the affirmative vote of a
majority of either the Continuing Directors who were members
of such Board at the time of such nomination or election, or
the shares beneficially owned by Orion Capital Corporation
and its subsidiaries.
(f) "Exchange Act" means the Securities Exchange Act
of 1934, as amended from time to time.
(g) "Fair Market Value" means, with respect to Stock,
Awards, or other property, the fair market value of such
Stock, Awards, or other property determined by such methods
or procedures as shall be established from time to time by
the Committee in good faith and in accordance with
applicable law. Unless otherwise determined by the
Committee, the Fair Market Value of Stock shall mean the
mean of the high and low sales prices of Stock on the
relevant date as reported on the stock exchange or market on
which the Stock is primarily traded, or if no sale is made
on such date, then the Fair Market Value is the weighted
average of the mean of the high and low sales prices of the
Stock on the next preceding day and the next succeeding day
on which such sales were made, as reported on the stock
exchange or market on which the Stock is primarily traded.
(h) "ISO" means any Option designated as an incentive
stock option within the meaning of Section 422 of the Code.
(i) "Option" means a right granted to a Participant
pursuant to Section 6(b) to purchase Stock at a specified
price during specified time periods. An Option may be
either an ISO or a nonstatutory Option (an Option not
designated as an ISO).
(j) "Performance Unit" means a right granted to a
Participant pursuant to Section 6(c) to receive a payment in
cash and or stock equal to the increase in the book value of
the Company during specified time periods if specified
performance goals are met.
(k) "Stock-Based Award" means a right that may be de
nominated or payable in, or valued in whole or in part by
reference to the market value of, Stock, including, but not
limited to, any Option, Stock granted as a bonus or Awards
in lieu of cash obligations.
(l) "Subsidiary" shall mean any corporation,
partnership, joint venture or other business entity of which
50% or more of the outstanding voting power is beneficially
owned, directly or indirectly, by the Company.
(m) "Tax Bonus" means a payment in cash in the year in
which an amount is included in the gross income of a Partici
pant in respect of an Award of an amount equal to the fed
eral, foreign, if any, and applicable state and local income
and employment tax liabilities payable by the Participant as
a result of (i) the amount included in gross income in re
spect of the Award and (ii) the payment of the amount in
clause (i) and the amount in this clause (ii). For purposes
of determining the amount to be paid to the Participant pur
suant to the preceding sentence, the Participant shall be
deemed to pay federal, foreign, if any, and state and local
income taxes at the highest marginal rate of tax imposed
upon ordinary income for the year in which an amount in
respect of the Award is included in gross income, after
giving effect to any deductions therefrom or credits
available with respect to the payment of any such taxes.
Section 3. Administration of the Plan
The Plan shall be administered by the Compensation
Committee of the Board of Directors of the Company (the "Com
mittee"). No member of the Committee while serving as such
shall be eligible for participation in the Plan. Any action
of the Committee in administering the Plan shall be final,
conclusive and binding on all persons, including the
Company, its Subsidiaries, employees, Participants, persons
claiming rights from or through Participants and
stockholders of the Company.
Subject to the provisions of the Plan, the Commit
tee shall have full and final authority in its discretion
(a) to select the key employees who will receive Awards
pursuant to the Plan ("Participants"), (b) to determine the
type or types of Awards to be granted to each Participant,
(c) to determine the number of shares of Stock to which an
Award will relate, the terms and conditions of any Award
granted under the Plan (including, but not limited to, re
strictions as to transferability or forfeiture,
exercisability or settlement of an Award and waivers or
accelerations thereof, and waivers of or modifications to
performance conditions relating to an Award, based in each
case on such considerations as the Committee shall deter
mine) and all other matters to be determined in connection
with an Award; (d) to determine whether, to what extent, and
under what circumstances an Award may be settled, or the ex
ercise price of an Award may be paid, in cash, Stock, other
Awards or other property, or an Award may be cancelled, for
feited, or surrendered; (e) to determine whether, and to
certify that, performance goals to which the settlement of
an Award is subject are satisfied; (f) to correct any defect
or supply any omission or reconcile any inconsistency in the
Plan, and to adopt, amend and rescind such rules and regu
lations as, in its opinion, may be advisable in the adminis
tration of the Plan; and (g) to make all other
determinations as it may deem necessary or advisable for the
administration of the Plan. The Committee may delegate to
officers or managers of the Company or any Subsidiary or to
unaffiliated service providers the authority, subject to
such terms as the Committee shall determine, to perform
administrative functions and to perform such other functions
as the Committee may determine, to the extent permitted
under Rule 16b-3, Section 162(m) of the Code and applicable
law.
Section 4. Participation in the Plan
Participants in the Plan shall be selected by the
Committee from among the key employees of the Company and
its Subsidiaries.
Section 5. Plan Limitations; Shares Subject to the Plan
(a) Subject to the provisions of Section 8(a) hereof,
the aggregate number of shares of common stock, $1.00 par
value, of the Company (the "Stock") available for issuance
as Awards under the Plan shall not exceed 700,000 shares.
No Award may be granted if the number of shares to
which such Award relates, when added to the number of shares
previously issued under the Plan and the number of shares
which may then be acquired pursuant to other outstanding,
unexercised Awards, exceeds the number of shares available
for issuance pursuant to the Plan. If any shares subject to
an Award are forfeited or such Award is settled in cash or
otherwise terminates for any reason whatsoever without an
actual distribution of shares to the Participant, any shares
counted against the number of shares available for issuance
pursuant to the Plan with respect to such Award shall, to
the extent of any such forfeiture, settlement, or
termination, again be available for Awards under the Plan;
provided, however, that the Committee may adopt procedures
for the counting of shares relating to any Award to ensure
appropriate counting, avoid double counting, and provide for
adjustments in any case in which the number of shares
actually distributed differs from the number of shares
previously counted in connection with such Award.
(b) Subject to the provisions of Section 8(a) hereof,
the aggregate number of Performance Units which may be
awarded under the Plan shall not exceed 350,000. If any
Performance Units awarded under the Plan shall be forfeited
or cancelled, such Performance Units shall thereafter be
available for award under the Plan.
Section 6. Awards
(a) General. Awards may be granted on the terms and
conditions set forth in this Section 6. In addition, the
Committee may impose on any Award or the exercise thereof,
at the date of grant or thereafter (subject to Section
8(a)), such additional terms and conditions, not
inconsistent with the provisions of the Plan, as the
Committee shall determine, including terms requiring
forfeiture of Awards in the event of termination of
employment by the Participant; provided, however, that the
Committee shall retain full power to accelerate or waive any
such additional term or condition as it may have previously
imposed. All Awards shall be evidenced by an Award
Agreement.
(b) Options. The Committee may grant Options to
Participants on the following terms and conditions:
(i) Exercise Price. The exercise price of each
Option shall be determined by the Committee at the time the
Option is granted, but (except as provided in Section 7(a))
the exercise price of any Option shall not be less than the
Fair Market Value of the shares covered thereby at the time
the Option is granted.
(ii) Time and Method of Exercise. The Committee
shall determine the time or times at which an Option may be
exercised in whole or in part, whether the exercise price
shall be paid in cash or by the surrender at Fair Market
Value of Stock, or by any combination of cash and shares of
Stock, including, without limitation, cash, Stock, other
Awards, or other property (including notes or other contrac
tual obligations of Participants to make payment on a de
ferred basis, such as through "cashless exercise" arrange
ments, to the extent permitted by applicable law), and the
methods by which Stock will be delivered or deemed to be de
livered to Participants.
(iii) Incentive Stock Options. The terms of any
Option granted under the Plan as an ISO shall comply in all
respects with the provisions of Section 422 of the Code, in
cluding, but not limited to, the requirement that no ISO
shall be granted more than ten years after the effective
date of the Plan.
(c) Performance Units. The Committee is authorized to
grant Performance Units to Participants on the following
terms and conditions:
(i) Performance Criteria and Period. At the time
it makes an award of Performance Units, the Committee shall
establish both the performance goal or goals and the
performance period or periods applicable to the Performance
Units so awarded. A performance goal shall be a goal,
expressed in terms of growth in book value, earnings per
share, return on equity or any other financial or other mea
surement deemed appropriate by the Committee, or may relate
to the results of operations or other measurable progress of
either the Company as a whole or the Participant's
Subsidiary, division or department. The performance period
will be the period of time over which one or more of the
performance goals must be achieved, which may be of such
length as the Committee, in its discretion, shall select.
Neither the performance goals nor the performance periods
need be identical for all Performance Units awarded at any
time or from time to time. The Committee shall have the
authority, in its discretion, to accelerate the time at
which any performance period will expire or waive or modify
the performance goals of any Participant or Participants.
The Committee may also make such adjustments, to the extent
it deems appropriate, to the performance goals for any
Performance Units awarded to compensate for, or to reflect,
any material changes which may have occurred in accounting
practices, tax laws, other laws or regulations, the
financial structure of the Company, acquisitions or
dispositions of business or Subsidiaries or any unusual
circumstances outside of management's control which, in the
sole judgment of the Committee, alters or affects the
computation of such performance goals or the performance of
the Company or any relevant Subsidiary, division or
department.
(ii) Value of Performance Units. The value of
each Performance Unit at any time shall equal the book value
per share of the Company's Stock, as such value appears on
the consolidated balance sheet of the Company as of the end
of the fiscal quarter immediately preceding the date of valu
ation.
(d) Bonus Stock and Awards in Lieu of Cash
Obligations. The Committee is authorized to grant Stock as
a bonus, or to grant Stock or other Awards in lieu of
Company or Subsidiary obligations to pay cash or deliver
other property under other plans or compensatory
arrangements; provided that, in the case of Participants
subject to Section 16 of the Exchange Act, such cash amounts
are determined under such other plans in a manner that
complies with applicable requirements of Rule 16b-3 so that
the acquisition of Stock or Awards hereunder shall be exempt
from Section 16(b) liability. Stock or Awards granted
hereunder shall be subject to such other terms as shall be
determined by the Committee.
(e) Other Stock-Based Awards. The Committee is autho
rized, subject to limitations under applicable law, to grant
to Participants such other Stock-Based Awards in addition to
those provided in Section 6(b) hereof, as deemed by the
Committee to be consistent with the purposes of the Plan.
The Committee shall determine the terms and conditions of
such Awards. Stock delivered pursuant to an Award in the
nature of a purchase right granted under this Section 6(f)
shall be purchased for such consideration and paid for at
such times, by such methods, and in such forms, including,
without limitation, cash, Stock, other Awards, or other prop
erty, as the Committee shall determine.
(f) Cash Payments. The Committee is authorized, sub
ject to limitations under applicable law, to grant to Par
ticipants Tax Bonuses and other cash payments, whether
awarded separately or as a supplement to any Stock-Based
Award. The Committee shall determine the terms and condi
tions of such Awards.
Section 7. Additional Provisions Applicable to Awards
(a) Stand-Alone, Additional, Tandem, and Substitute
Awards. Awards granted under the Plan may, in the
discretion of the Committee, be granted either alone or in
addition to, in tandem with, or in substitution for, any
other Award granted under the Plan or any award granted
under any other plan of the Company or any Subsidiary, or
any business entity acquired by the Company or any
Subsidiary, or any other right of a Participant to receive
payment from the Company or any Subsidiary. If an Award is
granted in substitution for another Award or award, the
Committee shall require the surrender of such other Award or
award in consideration for the grant of the new Award.
Awards granted in addition to, or in tandem with other
Awards or awards may be granted either as of the same time
as, or a different time from, the grant of such other Awards
or awards. The per share exercise price of any Option, or
purchase price of any other Award conferring a right to
purchase Stock:
(i) granted in substitution for an outstanding
Award or award, shall be not less than the lesser of (A) the
Fair Market Value of a share of Stock at the date such
substitute Award is granted or (B) such Fair Market Value at
that date, reduced to reflect the Fair Market Value at that
date of the Award or award required to be surrendered by the
Participant as a condition to receipt of the substitute
Award; or
(ii) retroactively granted in tandem with an out
standing Award or award, shall not be less than the lesser
of the Fair Market Value of a share of Stock at the date of
grant of the later Award or at the date of grant of the ear
lier Award or award.
(b) Exchange and Buy Out Provisions. The Committee
may at any time offer to exchange or buy out any previously
granted Award for a payment in cash, Stock, other Awards
(subject to Section 7(a)), or other property based on such
terms and conditions as the Committee shall determine and
communicate to a Participant at the time that such offer is
made.
(c) Performance Conditions. The right of a
Participant to exercise or receive a grant or settlement of
any Award, and the timing thereof, may be subject to such
performance conditions as may be specified by the Committee.
(d) Term of Awards. The term of each Award shall, ex
cept as provided herein, be for such period as may be deter
mined by the Committee; provided, however, that in no event
shall the term of any ISO exceed a period of ten years from
the date of its grant (or such shorter period as may be
applicable under Section 422 of the Code).
(e) Form of Payment. Subject to the terms of the Plan
and any applicable Award Agreement, payments or transfers to
be made by the Company or a Subsidiary upon the grant or ex
ercise of an Award may be made in such forms as the
Committee shall determine, including, without limitation,
cash, Stock, other Awards, or other property (and may be
made in a single payment or transfer, in installments, or on
a deferred basis), in each case determined in accordance
with rules adopted by, and at the discretion of, the
Committee. (Such payments may include, without limitation,
provisions for the payment or crediting of reasonable
interest on installments or deferred payments.) The
Committee, in its discretion, may accelerate any payment or
transfer upon a change in control as defined by the
Committee. The Committee may also authorize payment upon
the exercise of an Option by net issuance or other cashless
exercise methods.
(f) Loan Provisions. With the consent of the Commit
tee, and subject at all times to laws and regulations and
other binding obligations or provisions applicable to the
Company, the Company may make, guarantee, or arrange for a
loan or loans to a Participant with respect to the exercise
of any Option or other payment in connection with any Award,
including the payment by a Participant of any or all
federal, state, or local income or other taxes due in
connection with any Award. Subject to such limitations, the
Committee shall have full authority to decide whether to
make a loan or loans hereunder and to determine the amount,
terms, and provisions of any such loan or loans, including
the interest rate to be charged in respect of any such loan
or loans, whether the loan or loans are to be with or
without recourse against the borrower, the terms on which
the loan is to be repaid and the conditions, if any, under
which the loan or loans may be forgiven.
(g) Awards to Comply with Section 162(m). The Commit
tee may (but is not required to) grant an Award pursuant to
the Plan to a Participant who, in the year of grant, may be
a "Covered Employee," within the meaning of Section 162(m)
of the Code, which is intended to qualify as "performance-
based compensation" under Section 162(m) of the Code (a
"Performance-Based Award"). The right to receive a
Performance-Based Award, other than Options granted at not
less than Fair Market Value, shall be conditional upon the
achievement of performance goals established by the
Committee in writing at the time such Performance-Based
Award is granted. Such performance goals, which may vary
from Participant to Participant and Performance-Based Award
to Performance-Based Award, shall be based upon the
attainment by the Company or any Subsidiary, division or
department of specific amounts of, or increases in, one or
more of the following, any of which may be measured either
in absolute terms or as compared to another company or
companies: revenues, earnings, cash flow, net worth, book
value, stockholders' equity, financial return ratios, market
performance or total stockholder return, and/or the
completion of certain business or capital transactions.
Before any compensation pursuant to a Performance-Based
Award is paid, the Committee shall certify in writing that
the performance goals applicable to the Performance-Based
Award were in fact satisfied.
The maximum amount which may be granted as
Performance-Based Awards to any Participant in any calendar
year shall not exceed (i) Stock-Based Awards for 100,000
shares of Stock (whether payable in cash or stock), subject
to adjustment as provided in Section 8(a) hereof, (ii)
100,000 Performance Units, (iii) a Tax bonus payable with
respect to the Stock-Based Awards described in clause (i)
and Performance Units described in clause (ii), and (iv)
cash payments (other than Tax Bonuses) of $1,000,000.
(h) Change of Control. In the event of a Change
of Control of the Company, all Awards granted under the Plan
(including Performance-Based Awards) that are still
outstanding and not yet vested or exercisable or which are
subject to restrictions shall become immediately 100% vested
in each Participant or shall be free of any restrictions, as
of the first date that the definition of Change of Control
has been fulfilled, and shall be exercisable for the
remaining duration of the Award. All Awards that are
exercisable as of the effective date of the Change of
Control will remain exercisable for the remaining duration
of the Award.
Section 8. Adjustments upon Changes in Capitalization;
Acceleration in Certain Events
(a) In the event that the Committee shall determine
that any stock dividend, recapitalization, forward split or
reverse split, reorganization, merger, consolidation, spin-
off, combination, repurchase or share exchange, or other
similar corporate transaction or event, affects the Stock or
the book value of the Company such that an adjustment is
appropriate in order to prevent dilution or enlargement of
the rights of Participants under the Plan, then the
Committee shall, in such manner as it may deem equitable,
adjust any or all of (i) the number and kind of shares of
Stock which may thereafter be issued in connection with
Awards, (ii) the number and kind of shares of Stock issuable
in respect of outstanding Awards, (iii) the aggregate number
and kind of shares of Stock available under the Plan, (iv)
the number of Performance Units which may thereafter be
granted and the book value of the Company with respect to
outstanding Performance Units, and (v) the exercise price,
grant price, or purchase price relating to any Award or, if
deemed appropriate, make provision for a cash payment with
respect to any outstanding Award; provided, however, in each
case, that no adjustment shall be made which would cause the
Plan to violate Section 422(b)(1) of the Code with respect
to ISOs or would adversely affect the status of a
Performance-Based Award as "performance-based compensation"
under Section 162(m) of the Code.
(b) In addition, the Committee is authorized to make
adjustments in the terms and conditions of, and the criteria
included in, Awards in recognition of unusual or
nonrecurring events (including, without limitation, events
described in the preceding paragraph) affecting the Company
or any Subsidiary, or in response to changes in applicable
laws, regulations, or accounting principles. Not
withstanding the foregoing, no adjustment shall be made in
any outstanding Performance-Based Awards to the extent that
such adjustment would adversely affect the status of that
Performance-Based Award as "performance-based compensation"
under Section 162(m) of the Code.
Section 9. General Provisions
(a) Changes to the Plan and Awards. The Board of
Directors of the Company may amend, alter, suspend,
discontinue, or terminate the Plan or the Committee's
authority to grant Awards under the Plan without the consent
of the Company's stockholders or Participants, except that
any such amendment, alteration, suspension, discontinuation,
or termination shall be subject to the approval of the
Company's stockholders within one year after such Board
action if such stockholder approval is required by any
federal or state law or regulation or the rules of any stock
exchange or automated quotation system on which the Stock
may then be listed or quoted, and the Board may otherwise,
in its discretion, determine to submit other such changes to
the Plan to the stockholders for approval; provided,
however, that without the consent of an affected Par
ticipant, no amendment, alteration, suspension, discontinua
tion, or termination of the Plan may materially and
adversely affect the rights of such Participant under any
Award theretofore granted and any Award Agreement relating
thereto. The Committee may waive any conditions or rights
under, or amend, alter, suspend, discontinue, or terminate,
any Award theretofore granted and any Award Agreement
relating thereto; provided, however, that without the
consent of an affected Participant, no such amendment,
alteration, suspension, discontinuation, or termination of
any Award may materially and adversely affect the rights of
such Participant under such Award.
The foregoing notwithstanding, any performance
condition specified in connection with an Award shall not be
deemed a fixed contractual term, but shall remain subject to
adjustment by the Committee, in its discretion at any time
in view of the Committee's assessment of the Company's
strategy, performance of comparable companies, and other
circumstances, except to the extent that any such adjustment
to a performance condition would adversely affect the status
of a Performance-Based Award as "performance-based compensa
tion" under Section 162(m) of the Code.
Notwithstanding the foregoing, if the Plan is
ratified by the stockholders of the Company at the Company's
1997 Annual Meeting of Stockholders, then unless approved by
the stockholders of the Company, no amendment will: (i)
change the class of persons eligible to receive Awards; (ii)
materially increase the benefits accruing to Participants
under the Plan, or (iii) increase the number of shares of
Stock or the number of Performance Units subject to the
Plan.
(b) No Right to Award or Employment. No employee or
other person shall have any claim or right to receive an
Award under the Plan. Neither the Plan nor any action taken
hereunder shall be construed as giving any employee any
right to be retained in the employ of the Company or any
Subsidiary.
(c) Taxes. The Company or any Subsidiary is
authorized to withhold from any Award granted, any payment
relating to an Award under the Plan, including from a
distribution of Stock or any payroll or other payment to a
Participant amounts of withholding and other taxes due in
connection with any transaction involving an Award, and to
take such other action as the Committee may deem advisable
to enable the Company and Participants to satisfy
obligations for the payment of withholding taxes and other
tax obligations relating to any Award. This authority shall
include authority to withhold or receive Stock or other
property and to make cash payments in respect thereof in
satisfaction of a Participant's tax obligations.
(d) Limits on Transferability; Beneficiaries. No
Award or other right or interest of a Participant under the
Plan shall be pledged, encumbered, or hypothecated to, or in
favor of, or subject to any lien, obligation, or liability
of such Participants to, any party, other than the Company
or any Subsidiary, or assigned or transferred by such
Participant otherwise than by will or the laws of descent
and distribution, and such Awards and rights shall be
exercisable during the lifetime of the Participant only by
the Participant or his or her guardian or legal
representative. Notwithstanding the foregoing, the Committee
may, in its discretion, provide that Awards or other rights
or interests of a Participant granted pursuant to the Plan
(other than an ISO) be transferable, without consideration,
to immediate family members (i.e., children, grandchildren
or spouse), to trusts for the benefit of such immediate
family members and to partnerships in which such family
members are the only partners. The Committee may attach to
such transferability feature such terms and conditions as it
deems advisable. In addition, a Participant may, in the
manner established by the Committee, designate a beneficiary
(which may be a person or a trust) to exercise the rights of
the Participant, and to receive any distribution, with
respect to any Award upon the death of the Participant. A
beneficiary, guardian, legal representative or other person
claiming any rights under the Plan from or through any
Participant shall be subject to all terms and conditions of
the Plan and any Award Agreement applicable to such
Participant, except as otherwise determined by the
Committee, and to any additional restrictions deemed
necessary or appropriate by the Committee.
(e) No Rights to Awards; No Stockholder Rights. No
Participant shall have any claim to be granted any Award un
der the Plan, and there is no obligation for uniformity of
treatment of Participants. No Award shall confer on any Par
ticipant any of the rights of a stockholder of the Company
unless and until Stock is duly issued or transferred to the
Participant in accordance with the terms of the Award.
(f) Discretion. In exercising, or declining to
exercise, any grant of authority or discretion hereunder,
the Committee may consider or ignore such factors or
circumstances and may accord such weight to such factors and
circumstances as the Committee alone and in its sole
judgment deems appropriate and without regard to the affect
such exercise, or declining to exercise such grant of
authority or discretion, would have upon the affected
Participant, any other Participant, any employee, the
Company, any Subsidiary, any stockholder or any other
person.
(g) Effective Date. The effective date of the Plan is
October 29, 1996.
(h) Shareholder Approval. Unless and until the Plan
is approved by the stockholders of the Company at the
Company's 1997 Annual Meeting of Stockholders, no Stock-
Based Award may be granted to any officer of the Company.